Vermelho Nickel-Cobalt Project

 


Close Nickel Price US$/t
US$12,000/t
US$28,000/t
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(after capital payback)
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*The above NPV Calculator is based on the Vermelho nickel project Feasibility Study.

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AIM: HZM 3.41 GBX
TSX: HZM 0.06 CAD
Developing the next major nickel project in Brazil

THE VERMELHO NICKEL-COBALT PROJECT

The Group owns 100% of the Vermelho Nickel-Cobalt project. Vermelho is a high-grade scalable resource, located in the Carajás Mining District in the Pará State, north east Brazil. The area has a well-developed infrastructure, including roads, rail, and hydroelectric power as a result of the sustained mining activity in Carajás.

Vermelho was first developed by Vale (formerly CVRD) with the objective of becoming their principal nickel-cobalt operation. Extensive work was undertaken on the Project at Scoping (Preliminary Economic Assessment or PEA), PFS and Feasibility Study (FS) stages. This included drilling and pitting programs totalling 152,000 m, batch and full-scale pilot testwork, in addition to detailed engineering studies. The Project was subsequently taken through a Feasibility Study with Vale reporting a positive development decision in 2005. The Project was subsequently placed on hold following Vale’s purchase of Canadian nickel miner, Inco, in late 2005.

In December 2017, Horizonte reached an agreement with Vale SA to acquire 100% of the advanced nickel cobalt project. This acquisition transformed Horizonte into a multi asset company with two large projects located in an established mining district. The cobalt resource gave Horizonte exposure and access to an additional commodity stream in light of the burgeoning Battery Metal and Electric Vehicle market.

Horizonte released a Pre-Feasibility Study (PFS), in late 2019, looking at a smaller operational scenario with lower capital costs. The study confirmed Vermelho as a Tier 1 project with a large high-grade resource, a long mine life, and a low-cost source of nickel sulphate for the battery industry. This PFS was undertaken to suit the chosen scale and strategy targeted by Horizonte and to take advantage of the latest advancements in processing technology.

The Vermelho PFS comprises a planned open pit nickel laterite mining operation that covers a number of different pits. The hydro-metallurgical process comprises a beneficiation plant where ore is upgraded prior to being fed to a centralised High-Pressure Acid Leach (HPAL) and refining Plant which produces the sulphates. The Project will mine a 141.3 million tonne (Mt) Probable Mineral Reserve to produce 924kt of nickel contained in nickel sulphate, 36kt of cobalt contained in cobalt sulphate and 4.48 Mt of a saleable by-product, kieserite (a form of fertiliser) over an initially projected 38-year life. At full production capacity the Project is expected to produce an average of 25,000 tonnes of nickel and 1,250 tonnes of cobalt per annum, utilising the High-Pressure Acid Leach process.

The initial 38 year mine life of the PFS design will generate a free cash flows after taxation of US$7.3 billion, returning an IRR of over 26% on an initial capital cost of $US652 million and C1 cash cost of $8,029/t Ni during life of mine, and $7,286 C1 cash cost in years 1-10 (applying consensus nickel price of $16,400/tonne).

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